Restoring American Finacial Stability Act of 2010 - Motion To Proceed - Continued

Floor Speech

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Mr. SANDERS. Mr. President, let me begin by commending my friend from North Dakota, expressing my agreement of virtually everything he said. I
also commend Senator Dodd for the very hard work he has done in bringing forth a very strong piece of Wall Street reform legislation which is long overdue.

Let me also say that my good friend and neighbor from New Hampshire, Senator Gregg, took to the floor yesterday to express his outrage that 10 Senators on the Budget Committee voted for an amendment I offered--which lost, by the way, 12 to 10--to begin the process of breaking up too-big-to-fail financial institutions that pose a catastrophic risk to our economy. Frankly, after listening to Senator Gregg's statement, I wonder, with all due sincerity, what planet he is living on. Apparently, he has missed the fact that due to the greed, the recklessness, and the illegal behavior of Wall Street, the American people continue to suffer through the worst economic crisis since the Great Depression. The damage done by Wall Street in bringing this economy to a grinding halt is incomprehensible--millions of people having lost jobs, their homes, their savings, young people trying to go out into the job market to begin a career in their lives unable to do that because of the greed of Wall Street. The fact that just yesterday we could not get one Republican vote to proceed to begin the debate on how we finally reform Wall Street is beyond my comprehension. This debate needs to be going forward, and we need to pass strong--underline ``strong''--legislation that makes sure that what happened a year and a half ago never, ever happens again.

I also find it interesting that we have some of our conservative Republican Senators, such as Senator Gregg, who day after day tell us how much they dislike big government--they don't like Social Security, don't like Medicare, don't like big government--but apparently have no problem with huge financial institutions which control a very significant part of our economy. In the last 15 years, the six largest banks in this country have more than tripled in size and now have combined assets equal to 63 percent of the gross domestic product. Let me say that again. The six largest banks in this country now have combined assets equal to 63 percent of this Nation's GDP.

I ask all my conservative friends who come down saying: Oh, government is too big, government is awful, what about banks that have trillions of dollars in assets? Why aren't we talking about that reality? The truth is that today what we are seeing with these huge financial institutions is not only the ongoing problem of what happens when they fail and whether the taxpayers will be having to bail them out again, but when you have that kind of concentration of ownership, you have a very dangerous situation.

The four largest banks in this country, four banks, issue two-thirds of the credit cards. What do we think about that? Everyone in the world has a credit card. Four banks issue two-thirds of that.

How does that tally with the rhetoric I hear from my conservative friends about a competitive economy? Competition is what drives prices down.

Well, maybe one of the reasons millions of Americans today are paying 25 or 30-percent interest rates on their credit cards is you have got four banks that issue two-thirds of them.

The four largest banks in this country provide half of the mortgages in America. I think that is a real problem. The four largest banks control nearly 40 percent of all bank deposits in this country.

Over 100 years ago, we had some good Republicans, William Howard Taft and Teddy Roosevelt. When they saw the concentration of ownership and wealth that existed in their time, they, as good Republicans, said: Let's start breaking it up.

I think what they did over 100 years ago is a lesson we should learn today. If a financial institution is too big to fail, that financial institution is too big to exist and the time is now to start breaking it up.

This idea of starting to break up large financial institutions is not just an idea that BERNIE SANDERS has, it is not just an idea, an amendment offered by Senators BROWN of Ohio and KAUFMAN are going to speak to. It is an idea that is spreading all over this country.

I would point out to you that the presidents of three regional Federal Reserve Banks also support the need to start breaking up large financial institutions. These are: James Bullard, who is the president of the Fed in St. Louis; Thomas Toenig, the president of the Fed in Kansas City; and Richard Fisher, the president of the Fed in Dallas, TX. They are all in agreement that we have got to start breaking up these large financial institutions.

Senator Dorgan made this point, and I want to make it again; that is, that during the bailout, the Fed decided it was going to lend out trillions of dollars in zero or almost zero-interest loans. When Chairman Bernanke came before the Budget Committee, on which I serve, I asked him what I thought was a pretty simple and straightforward question: Mr. Chairman, can you tell me and the American people who received these loans?

I mean, we are talking about trillions of dollars in loans. I do not think it is too much to ask who received the loans and what the terms were of those loans. Well, Mr. Bernanke disagreed. I offered an amendment that day that begins to bring transparency to the Fed. That amendment is called the Federal Reserve Sunshine Act. I am happy to say it has 32 cosponsors. Interestingly enough, 22 of them are Republicans, 10 are Democrats. They are: Senators BARRASSO, BENNETT of Utah, BOXER, BROWNBACK, BURR, CARDIN, CHAMBLISS, COBURN, COCHRAN, CORNYN, CRAPO, DeMint, DORGAN, FEINGOLD, GRAHAM, GRASSLEY, HARKIN, HATCH, HUTCHISON, INHOFE, ISAKSON, LANDRIEU, LEAHY, LINCOLN, McCain, MURKOWSKI, RISCH, THUNE, VITTER, WEBB, WICKER, and WYDEN.

That is quite a cross section of political views in favor of bringing transparency to the Fed. What my amendment will do--and we intend to bring that amendment to the floor during this debate--is, in fact, it would require the Federal Reserve to release all of the details about the more than $2 trillion in zero-interest loans the Fed provided to large financial institutions. Also it would call for a GAO audit of the Fed.

The bottom line there is it is imperative that the GAO conduct an independent and comprehensive audit of the Federal Reserve within 1 year. That is what our amendment does. It requires the Federal Reserve to disclose the names of the financial institutions that received over $2 trillion in virtually zero-interest loans since the start of the recession.

This is an amendment that I think millions of people want. What is interesting about it is if you talk about bipartisanship or tripartisanship, this amendment, both in the House and the Senate, brings together some of the more conservative members and some of the more progressive members. In the House, this language is supported by my former colleague RON PAUL. I am introducing it here in the Senate. That, my friends, is a very significant disparity in political views. But we do agree that the Fed needs transparency.

Let me conclude by simply saying this: The time is now for the Senate to begin to deal with the greed, the recklessness, and the illegal behavior on Wall Street. The American people have demanded action since this crisis began, and we owe it to them to deliver. As we proceed with Senator Dodd's piece of legislation, which I think has many very positive attributes, I think our goal is as we debate it, to make it even stronger.

In that regard, as I mentioned, I will be bringing forward an amendment dealing with Fed transparency. I will be bringing forth an amendment which will put a cap on the interest rates that banks can charge. I think it is not acceptable, not moral, that banks are now charging 25, 30-percent interest rates. We are going to have a cap similar to what exists for credit unions.

As I mentioned also, we are going to have legislation, an amendment dealing with Fed transparency. So my hope is our Republican friends will join us in beginning this debate and, in fact, going forward so that finally, finally, we can hold Wall Street accountable and bring forth the legislation to make sure that never do we see a repetition of the disaster we saw a year and a half ago.

I yield the floor.

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